The government of Kazakhstan identified 106 cryptocurrency mines that were operating without the required licenses. 51 of these were stopped by authorities, and 55 were voluntarily shut down.
The Latest Crackdown
Kazakhstan declared war earlier this year on illegal digital asset-mining farms. Minister Bagdat Musin stated that these could have a negative impact on the country’s energy network.
“Gray miners do a lot to our power grid. Illegal mining is estimated to cost more than 1 gigawatt in energy.
A recent announcement stated that authorities had forced 106 crypto mining companies to cease their operations. 55 of them were forced to close down by the authorities.
Law enforcement ended the arrests of 51 other suspects, who were suspected of tax evasion or operating in special economic zones that do not require regulatory approval.
Further investigation revealed that the illegal companies were run by a number of prominent political and business figures. Bolat Nazarbayev (brother of former President Nursultan Nazarbayev), Kairat Itegmenov, Kazakhstan’s 17th wealthiest man, and Alexander Klebanov, Chairman of Central Asian Electric Power Corp.
The authorities also confiscated 65,000 pieces worth of mining equipment from these farms. This was worth over $190 million. 25 criminal cases were also opened against individuals in connection to the companies.
It is important to note that cryptocurrency mining is a significant niche for Kazakhstan. 18.1% of global hash rates are held by the former Soviet Union. With 35.4%, the US is the only nation that leads.
Operation Last Month
The government stopped the activities of 13 cryptocurrency mining facilities in February. These entities were found in various regions of the country, including Pavlodar and Turkestan. The farms had a combined electricity capacity of more than 200 megawatts according to estimates.
The officials pledged to continue locating and disconnection illicit organizations that cause damage to the local energy network. They also promised not follow the rules.
However, President Tokayev said that the government would not interfere with “white” miners who have the approval necessary to carry out their operations.
“The government does not oppose “white” miners. However, people who wish to operate in this sector need a license. They must also get electricity at the correct tariffs.
Marla Brooks – Financial Analysis
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